Rise of a late developer who came from behind

BEFORE hisdramatic arrival at Lonrho, Dieter Bock's business career had blossomed late. Only in the last four years, when he was over 50, does he appear to have made a great deal of money and to have gathered a group of investors in his companies - whose identity remains a mystery.

His big breakseems to have come in 1989, when one of his companies, Gouden Akker, recorded a profit of Fl144m ( pounds 46m) after selling some shares.

In 1991, Mr Bock was big enough to decide the future of a large German construction company, Dyckerhoff and Widmann. He bought a 25 per cent stake, intending to take it over, but changed tack and sold to a rival bidder, Walter Bau group - again for a big profit. By the end of that year, it would seem Mr Bock had climbed into the big league, seriously rich with ambitions to match.

Born in 1939, he was the son of an engineer at a film factory in Dessau in whatbecame East Germany. When Mr Bock was 14, the family fled to the West. He studied law and accountancy before setting up his own consultancy, Bilanz und Steuer (Finance and Tax) in 1973. In the succeeding decade and a half, he converted clients into investors in special legal partnerships, investing in property that enabled them to set their share of the start-up losses against their personal taxes.

Mr Bock was based in Frankfurt, but his investments were carried out through a web of companies in Germany, the US, the Netherlands and Britain.

His career as a businessman began with Kaufhaus KaWe, a small and unsuccessful chain of department stores. Gisela Heinemann, the daughter and heir of a Bock client, Erich Heinemann, was part-owner of Kaufhaus. In 1986, the stores' properties were transferred to Mr Bock's property subsidiary, Advanta Management, in anticipation of expansion plans which did not materialise. Throughout his involvement the group has failed to make large profits.

Mr Bock's first big deal came in 1988, when Philipp Holzmann, Germany's largest construction company, said it had acquired a 135,000sq m site in Frankfurt in partnership with a 'lawyer', later revealed to be Mr Bock. The deal proved extremely profitable, although it is difficult to work out which of Mr Bock's companies received the benefit.

After his windfalls in 1989 and 1991, deals became ever larger. In 1992, Mr Bock bought a 50 per cent stake in the Kempinski hotel chain in Eastern Europe for DM300m ( pounds 123m). Then came the pounds 130m Lonrho deal. The source of the money for this remains mysterious. Mr Bock maintains half is his own, the rest borrowed from banks such as Deutsche Bank. He says it is completely separate from his Continental operations so that, if it goes wrong, the rest of his empire will be unaffected. The Lonrho shares are, indeed, owned by a company called Laerstate, which used to be owned by Gouden Akker (one of his Continental vehicles) but which, in December last year, was put into Mr Bock's name.

Mr Bock's first involvement in Britain came in 1990, when Advanta and Holzmann bought stakes in the construction group, Tilbury. But his biggest deal, apart from his pounds 130m stake in Lonrho, was his 50 per cent stake in Kempinski.

Today the relationship between Mr Bock, Holzmann,the various 'Advanta' companies and Gouden Akker remains less clear than it would be under British law, which would have forced him to set out clearly the shareholdings and inter-company relationships involved.

This is a shortened version of an article that first appeared in Eurobusiness.